Creative transactions related to a sporting goods business for the month of August 2023:

a) Capital Introduced:

1. Cash in hand: The owner, John, contributed RM5,000 from his personal savings to the business to start operations.

2. Cash at bank: John transferred RM10,000 from his personal bank account to the business bank account as initial capital.

3. Non-current assets: John contributed a pair of vintage shoes from his personal collection, valued at RM2,000, to be used for display purposes in the store.

b) Loan taken from a bank John secured a loan of RM20,000 from a local bank to expand his footwear business and improve the store's infrastructure.

c) Non-current assets acquired on credit: 1. John purchased a shoe display rack worth RM1,500 from a supplier on credit. 2. He also acquired a new cash register valued at RM800 from another supplier, also on credit.

d) Non-current assets acquired on cash basis: John purchased a showcase cabinet for RM1,200 in cash to display high-end designer shoes.

e) Trade goods purchased on credit:

1. John bought 50 pairs of sports shoes from Supplier A for RM3,000.

2. He purchased 30 pairs of casual shoes from Supplier B for RM2,400.

f) Trade goods purchased on cash basis:

1. John purchased 20 pairs of children's shoes from Supplier C for RM800 in cash.

2. He also bought 10 pairs of sandals from Supplier D for RM600 in cash.

g) Trade goods sold on credit:

1. John sold 15 pairs of sports shoes to Customer A for RM1,500 on credit.

2. He sold 10 pairs of casual shoes to Customer B for RM800 on credit.

h) Trade goods sold on cash basis:

1. John sold 5 pairs of children's shoes to Customer C for RM200 in cash.

2. He sold 3 pairs of sandals to Customer D for RM150 in cash.

i) Return of goods by customers:

1. Customer A returned 2 pairs of sports shoes, which were originally sold on credit, due to size issues.

2. Customer C returned 1 pair of children's shoes, which was purchased for cash, as it didn't fit properly.

j) Return of goods to suppliers: John returned RM1,500 worth of shoe soles to SoleSupreme due to quality problems and returned $2,000 worth of exotic leather to LeatherLux because of delivery of the wrong product.

k) Payment to supplier inclusive of discount received Made a payment of $11,500 to LeatherLux inclusive of a discount of $500.

l) Payment by customers inclusive of discount allowed Received a payment of $18,500 from Luxury Outlets inclusive of a discount of $1,500. m) Payment of expenses by cheque

1. Paid electricity bill ($1,200)

2. phone bill ($800)

3. advertising costs ($2,000) by cheque

n) Payment of expenses by cash

1. Paid cleaning service ($500)

2. office supplies ($300) by cash.

o) Receipt of income by cheque

1. Received income by cheque from a local school for a bulk order, $4,000

2. from a local event for sponsoring shoes, $5,000. p) Receipt of income by cash Received $2,000 cash income from a community event for custom shoe orders.

q) Withdrawal of goods for personal use Withdrew a pair of designer boots ($200) for personal use.

r) Withdrawal of cash for personal use Withdrew $2,000 cash for personal use.

Question/Recording:

i. Record the transaction in proper journal. 

ii. Post the transactions to the relevant ledgers. 

iii. Prepare an unadjusted trial balance as at 31 August 2023. 

iv. Prepare profit and loss statement for the year ended 31 August 2023. 

v. Prepare statement of financial position as at 31 August 2023. 

Answer rating: 100% (QA)

1 Journal entries a Capital Introduced Cash in hand Debit Cash in Hand Asset RM5000 Credit Owners Capital Equity RM5000 Cash at bank Debit Cash at Bank Asset RM10000 Credit Owners Capital Equity RM100... View the full answer